HP Seeks New Skills to Staff Data Centers

Hewlett-Packard is cutting 9,000 IT jobs while adding 6,000 new employees who have sales and service-delivery expertise.

The realignment plan that Hewlett-Packard Co. announced last week -- which calls for cutting 9,000 IT positions while adding 6,000 new employees -- is the latest example of the changing staffing needs brought on by a shift to highly automated data centers that no longer require workers with hands-on IT skills.

Many companies are looking to staff next-generation data centers with people who have expertise in the sale and delivery of IT services.

HP has not yet specified which positions are slated for elimination, but James Staten, an analyst at Forrester Research Inc., speculated that they will most likely be IT operations posts like systems administrators. Most of the 6,000 new hires will probably be IT architecture and sales experts, he added.

The company said the changes in its Enterprise Services unit will take place over several years.

In a conference call with investors, HP executives called the realignment the latest step in the evolution of its services operation -- a key part of the company since its 2008 Electronic Data Systems Corp. acquisition, which brought 137,000 new employees on board.

HP said the restructuring will also include the consolidation of data centers and management platforms that will eventually allow for a more automated delivery of services to customers. "We think the next five to 10 years are going to be about who can best use technology to automate the delivery of services," said Ann Livermore, executive vice president of HP's Enterprise Business unit.

The plan renews an effort launched prior to the EDS deal, when HP cut its corporate data centers from some 85 to six, added industry-standard products and got rid of redundant or outdated hardware and software.

HP has gained a raft of new data centers since the EDS deal; most were acquired from customers as part of outsourcing agreements.

Martin Reynolds, an analyst at Gartner Inc., said that the services unit improved the efficiency of the acquired data centers, but "they are [still] not as streamlined as HP wanted them to be."

Reynolds expects that HP will move to further streamline those operations by turning to x86 applications for consolidation and virtualization rather than mainframe and Unix systems. "They are looking to take all those nonvirtualized x86 applications and move them to HP's managed environment," he said.

The moves may indicate that HP has convinced its customers that its data center plans will ultimately reduce their IT costs.

Peter Sayer and Chris Kanaracus of the IDG News Service contributed to this story.

Copyright © 2010 IDG Communications, Inc.

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